We propose to examine in detail the mechanisms by which genetic factors and parent-child relationships combine to influence the development of children across the toddler transition. We focus on the developmental pathways leading to internalizing problems, to externalizing problems and to attachment security/social competence. Current research indicates that each of these pathways may have separable genetic and parental influences but nothing is known now about how these two routes of development combine over time. We propose a design that will help first to separate these two sets of important influences. We will then examine the mechanisms by which they combine as the child develops from 9 until 24 months. We focus our efforts on three objectives: 1) clarification of the separability of the three developmental paths in very early childhood; 2) assessment of parenting as mediator of genetic influence on each of these pathways, evocative G.E correlation and 3) appraisal of parental characteristics and parenting as moderators of the expression of genetic influence on child behavior, GxE interaction. Our prospective adoption design, which is ideally suited for this important step in developmental studies, will study 400 "yoked" family units each of which contains a birth mother and birth father as well as an adoptive mother and father and the adopted child. We will assess birth and adoptive parents for a range intellectual and social competence as well as psychopathology that has been associated with internalizing and externalizing in young children. We assess the child's developing social competence as well as early manifestations of internalizing and externalizing problems and use state of the art assessments of mother-child and father-child relationships.